POGO kicked off 2007 by releasing its "Baker's Dozen" of topics Congress should consider this year. The list is comprised of 13 systemic problems that have persisted throughout much of POGO's two-and-a-half-decade history, such as the need to fix the nation's broken federal contracting system, to strengthen whistleblower protections, and to provide effective homeland security. Congress should also force the nuclear weapons complex and the Pentagon to meet current and future threats rather than allowing them to continue to fight the Cold War.

Another area in need of congressional attention is the improper privatization of government functions. Under both the Clinton and Bush Administrations, vast swaths of the federal government have been shifted into the private sector. Congress should ensure that, in the process of implementing a sensible shrinking of the government, fundamentally governmental functions are not turned over to the private sector, which is less accountable to the public.

Yet another topic for congressional consideration is the effectiveness of government watchdog offices such as Inspectors General. Government watchdogs are supposed to help Congress hold the Executive Branch accountable by rooting out waste, fraud, and abuse, and by shedding light on issues in need of attention. However, anecdotal evidence suggests that government auditing and investigative branches have been denied resources needed to properly oversee the dramatically expanding federal spending. They may also need increased authorities or independence to fulfill their missions. The time has come for Congress to take a hard look at the government's watchdogs to assess how to better enable them to perform effective oversight.

On another front, the Department of Homeland Security has been open for business for five years but still has all the problems of a new start-up. The results of these problems are not in dispute: billions of dollars wasted on untested and ineffective technologies, and an inability to protect—and in some cases even identify—parts of our most vulnerable infrastructure including aviation, rail, and chemical facilities. In other cases, DHS doesn't even play a role, and other government agencies haven't picked up the slack. Congress should hold DHS accountable for meeting its mission.

POGO'S 2007 BAKER'S DOZEN

1. Addressing Federal Contractor Misconduct

2. Hidden Costs of Improper Privatization

3. Executive Branch Revolving Door and Conflicts-of-Interest

4. Whistleblower Retaliation

5. The Black Hole that is Pentagon Spending

6. Excessive Secrecy

7. Defense Spending Priorities: Supporting the Troops or the Defense Contractors?

8. Government Watchdog and Accountability Organizations

9. Dragging the Government out of the Cold War

10. Oil and Gas Drilling on Federal and Native American Lands

11. Who is Securing the Homeland? Because DHS Is Not

12. Conflicts of Interest in Scientific Research

13. Fixing the Broken Federal Contracting System

Director's Letter

Dear Friends,

A year ago, the common wisdom Washington, D.C., was that "the people" were completely disengaged, that they didn't care about the inner workings of their government. This opinion was held by politicians, echoed by the media, and exploited by powerful special interests.

We at POGO, however, never doubted the level of the public's interest and we were right: After decades of increasingly being shut out of the running of their own government, the public said "Enough" and demanded a system of increased oversight. Now, oversight seems to have taken Washington by storm.

Make no mistake: this is neither a Democratic nor a Republican phenomenon—it is a public pressure phenomenon.

Indicative of this change is the interest in POGO's monthly, bi-partisan Congressional Oversight Training Series for Hill staff, which brings old-guard practitioners together with newer staff to discuss the art of congressional oversight. We always have both a Republican and a Democrat instructing at the sessions, and much of the feedback we get reflects how much the participants appreciate being in a genuinely bi-partisan environment.

In addition, our Baker's Dozen of suggested topics for congressional investigation (see our Page 1 article) has been received with great interest on Capitol Hill, as well as by the media. Newspapers, blogs, and TV news are filling up with a new interest in government oversight.

The enthusiasm for oversight is also spreading into the international arena: POGO staff are being invited to speak to audiences around the world on the importance of oversight and how to apply POGO's methodology of working with whistleblowers and other insiders to other countries (see our related article on Page 5).

We are very conscious that we cannot do our work without our colleagues in Congress, Executive Branch agencies, the media, other non-governmental organizations, whistleblowers, citizen activists, and supporters who are also dedicated to a more open, honest, and accountable federal government. It looks like 2007 is our year!

Sincerely,

Danielle Brian, Executive Director

With the new Congressional promise of increased oversight in mind, whistleblower advocates are hard at work pushing for meaningful protections that will finally cover all federal employees who seek to expose wrongdoing.

On February 1, a coalition of groups involved in promoting whistleblower protections held its first one-day summit, which POGO organized. The Make It Safe Coalition grew out of a long-standing and increasing desire by individual groups to unify their whistleblower protection message and to more effectively work with Congress to gain those protections.

Over a dozen coalition groups were represented at the summit. The Coalition discussed several pieces of whistleblower legislation currently under consideration by Congress, created an executive committee to improve communication among member organizations and to facilitate the coalition's efforts, and developed a list of member organizations willing to work directly with Congress.

Within weeks of the summit, representatives of two of the groups—POGO's Nick Schwellenbach and GAP's Tom Devine—testified before the House Oversight and Government Reform Committee about one of the most promising pieces of legislation that Congress is considering. The "Whistleblower Protection Enhancement Act of 2007" (H.R. 985) extends whistleblower protections to Transportation Security Administration's baggage screeners, FBI and intelligence agency employees, and to government contractor employees. The legislation also closes loopholes in the Whistleblower Protection Act's coverage, and ends the Federal Circuit Court of Appeals' stranglehold on jurisdiction over whistleblower cases. The day after the hearing, the bill was passed unanimously out of committee.

POGO will continue its work to improve whistleblower protections as the year progresses.

Essential Component to Missile Defense Not All It's Cracked Up to Be

Over the past year, POGO has worked to shed light on problems with the Sea-Based X-band (SBX) radar platform, a crucial component of the nation's missile defense program. The SBX is a movable, floating tracking station and is the primary means of tracking any intercontinental ballistic missiles that may cross the northern Pacific and Arctic Oceans, threatening the west coast of the United States. If the SBX does not work, the multi-billion dollar U.S. national missile defense system will be rendered blind.

Although the SBX's radar is deemed powerful and the converted oil platform it sits on is considered robust, an official independent evaluation obtained by POGO shows that there are problems with the SBX that may be difficult to overcome.

The main problem is the environment in which the SBX sits: the unforgiving northern Pacific. According to the Alaska Coast Guard Command, the waters are "inherently dangerous," and even Boeing—the contractor building the station—asserts in an internal document that "ice accumulation could . . . induce enough damage to the rigging to cause it to fall." Furthermore, the station's location makes it dependent on a delicate supply chain. Should the supply chain fail for any reason, the station itself would cease to function: the food, fuel, spare parts, and other essentials necessary to keep it operating would run out.

Nature is not the only threat to the SBX: the station is also too vulnerable to man-made threats. "There is no provision," according to the independent evaluation, "for defense against a surface to surface missile aimed at the Radome [the structure surrounding the radar antenna] or the superstructure." Nor does the SBX have "effective stopping capability against a motor vessel such as a large fishing trawler which would have the capability to inflict physical damage in an intentional collision."

POGO will continue to work with Congress and the media to ensure that the system's vulnerabilities are addressed.

Improvements to Federal Contracting Gain Momentum

Only two years after its initial meeting in 2005, the Acquisition Advisory Panel—a congressionally-mandated panel convened to examine the federal procurement process—released its draft final report on the status of the federal contracting system, in which it made several findings and recommendations.

Information presented to the Panel during its comprehensive review highlighted many differences between the private sector's buying systems—which government contracting reformers tried to mirror for its efficiency and effectiveness—and the system used by the government. Among other things, the Panel found that the private sector utilizes competition in order to get the best deal (a seemingly common-sense practice). As a result, no-bid contracts are rare in the private sector. The government, however, uses one-bid contracts about 20 percent, and no-bid contracts about 30 percent, of the time. In other words, the Panel found that the federal government used genuinely competitive practices for only about half of all contract spending.

The Panel also found that the use of the commercial designation is problematic. Designating an item or service as "commercial" eliminates a lot of the oversight requirements, thereby reducing the amount of paperwork that needs to be done. However, if the item or service is not actually sold in the commercial marketplace, the reduced oversight dramatically increases the likelihood of excessive overcharging. The Panel recommended that the government rein in commercial service contracts. Simply stated, the government should buy as commercial only those services that are sold competitively in substantial quantities in the public realm rather than solely to the government.

Although some of the Panel's recommendations do not go as far as POGO would like, the majority would still improve competition, negotiations, oversight, transparency, and spending decision-making. Given that federal contract spending exceeded $380 billion in fiscal year 2005, the Panel's conclusions should be given serious consideration by policymakers.

POGO Testifies About Nuclear Security Recommendations

In January, POGO testified before the House Energy and Commerce Committee

regarding the implications of the most recent security failure at Los Alamos—the discovery of hundreds of classified documents in a trailer park meth lab.

Although an office called the National Nuclear Security Administration (NNSA) had been created to improve security—and in particular cyber-security—in the nuclear weapons complex, security failures continue to plague the complex. As a result, Energy Secretary Samuel Bodman recently asked NNSA Administrator Linton Brooks to resign. But getting a new Administrator is not enough: the current system of incentives must be overhauled.

First, the Department of Energy (DOE) needs to make a commitment to conducting independent federal oversight. This means immediately ending the "self-policing" pilot program at Los Alamos, in which the government has turned over responsibility for oversight to the contractor itself. In addition, officials should be held accountable if the recommendations made by DOE's oversight offices are not implemented.

Second, the contract to operate Los Alamos should be reworked: the incentive fee should be recalculated to reflect the equal importance of accomplishing the mission, ensuring security, and doing so safely. Another provision in the contract, the "at-will" employment provision, should also be changed. Currently, if an employee is the bearer of bad news to management, the employee can be fired "at will." This is hardly an incentive to bring problems to light.

Third, Congress has recently requested the Government Accountability Office to conduct an audit of Los Alamos' many programs. Questions Congress should ask include: Is the disparate nature of the Lab's work making it harder to maintain excellence in safety and security? Do the current projects reflect what Congress believes are the most urgent priorities for Los Alamos' scientists?

And finally, DOE will be submitting a request for $150 billion to fund a wildly ambitious project to revamp the nuclear weapons complex, known as Complex 2030. Before funding this massive new project, Congress must have confidence in the mission, security, and workers' safety in the current complex.

POGO Participates in United Nations Anti-Corruption Conference

In December 2006, POGO's General Counsel Scott Amey traveled to Courmayeur Mont Blanc, Italy, to participate in the International Scientific and Professional Advisory Council's conference on the "United Nations Convention Against Corruption as a Way of Life." The three-day conference brought together 150 representatives of governments, multilateral organizations, the media, civil society, academia, and the private sector to explore how to further anti-corruption efforts.

The United Nations Convention Against Corruption has been signed by 140 countries and ratified by 83 countries, including the United States. The purposes of the Convention include preventing and combating corruption, and promoting integrity, accountability, and proper management of public affairs and public property.

Scott presented a white paper entitled "Rampant Corruption Exacerbates Public Distrust in Public and Private Sector Dealings" and discussed how POGO builds and sustains coalitions to fight against corruption. POGO hopes that its participation in the UN's conference and the many contacts it has made will assist in its efforts to fight government corruption here at home.

The following are excerpts from POGO's white paper:

Integrity in the public and private sectors is under assault today more than it has ever been since the Project On Government Oversight (POGO) was founded over 25 years ago. Institutional corruption in both the public and private sectors undermines the public's confidence in the democratic process and exacerbates distrust in our society. For example, the United States has been shaken by corporate scandals involving corporate giants Enron, WorldCom, Boeing, and many of those giants' executives. Darleen Druyun, a former senior Air Force official, admitted to performing favors for her post-government employer Boeing. Randy "Duke" Cunningham, a former Member of Congress from California, is now infamous for his "bribe menu"—a list of bribes that he demanded in exchange for government contracts. David Safavian, a former head of government contracting, was found guilty of four charges, including obstruction of justice, related to his relationship with disgraced former Washington lobbyist Jack Abramoff, who has become infamous for one of the largest government corruption scandals in the U.S.

The United States might meet the literal requirements of the United Nations Convention Against Corruption, but it has a long way to go before becoming an anti-corruption leader. . . . [For instance,] there is the problem of the proverbial "fox guarding the hen house." Simply stated, those who are in power and who influence policymakers are the same people who taxpayers must rely on to improve the ethics system and promote an anti-corruption agenda. For example, a regulation to promote a "zero-tolerance" policy on human trafficking has been proposed by multiple U.S. agencies. Certain private sector entities, many of which have Iraq reconstruction contracts or other contracting interests around the world, have nominally supported the proposed rule. Those same entities, however, claim that rule's requirements are too difficult to monitor and enforce. As an alternative, those private entities have suggested very minor changes that will neither hold them accountable nor protect victims of human trafficking.

An anti-corruption system is in place, but it is far from being the perfect system. The U.S. has a long way to go to be a five-star member of the Convention.